Relating to Real Estate

In a case involving the same type of damage as in Penthouse 4C, LLC discussed in the article above but to a different unit at 100 Harborview Drive Condominium, the owner of Penthouse 4A, Dr. Paul C. Clark, sued 100 Harborview Drive Condominium Council of Unit Owners (“Harborview”) and property manager Zalco Realty, Inc., alleging that they had engaged in fraudulent misrepresentation and unfair or deceptive trade practices when they advised him at closing that they had no knowledge of any violation of the health or building codes with respect to his apartment. In Winter 2010, Dr. Clark had to vacate his apartment due to mold caused by a leak in his roof.

In his complaint Dr. Clark also alleged that, pursuant to the disclosure requirements of the Maryland Condominium Act, Maryland Code, Real Property Article §§ 11-101 et seq., he was entitled to examine billing reports for Harborview’s legal invoices as well as written advice of Harborview’s legal counsel concerning the lawsuit.

In a July 30, 2015 opinion, the Court of Special Appeals agreed with the Circuit Court for Baltimore City that the Maryland Condominium Act does not abrogate the common law attorney-client privilege or the work product doctrine. See100 Harborview Drive Condominium Council of Unit Owners v. Clark, 224 Md. App. 13, 119 A.3d 87 (2015). The court wrote that the Maryland Condominium Act (i) contains no specific words of repeal or abrogation, (ii) neither invalidates nor supplants the entire subject matter of attorney-client privilege or work product doctrine, and (iii) was not irreconcilable with the preservation of fundamental protections and privileges held and not waived by the protected party. Rather, in enacting the Maryland Condominium Act, “the General Assembly has evinced the intention to provide the information necessary to property owners so that they might assess and protect their investments, while simultaneously recognizing the importance of protecting certain documents from unnecessary disclosure.” Accordingly, the Court of Special Appeals held that Dr. Clark was allowed to inspect the billing reportsregarding repairs to the unit, but not the written advice of Harborview’s counsel because the latter was protected by the attorney-client privilege.

For questions, please contact Richard Topaz (410) 576-4004.